Unfair but balanced commentary on tax and budget policy, contemporary U.S. politics and culture, and whatever else happens to come up

Wednesday, May 27, 2009

Doug Holtz-Eakin talks up new conservative think tank

I admit to having been hard occasionally on Doug Holtz-Eakin during the 2008 presidential campaign. I had three reasons for this: (1) at times he deserved it, (2) I expected better from him, and (3) he risked harming his entire profession's public reputation through egregious flacking that should have been left to others in the McCain campaign. The strangest thing about his flacking was its inconsistency - one day he'd spout a silly talking point that was beneath his station (so to speak), and the next day he'd make a responsible comment about the long-term fiscal situation (which of course neither candidate wanted to highlight).

Anyway, Doug has now resurfaced via his statement that he's developing a proposal for a new think tank that he calls a “Center for American Progress for the right.”

This in turn prompts Paul Krugman and Matt Yglesias to note the already large supply of conservative think-tanks (such as AEI and Heritage) with exceptionally deep funding. They posit that, since the Republican Party and the conservative movement have gone stark raving mad, institutions that align with them, in Yglesias' words, must "not [be] prepared to accept anything other than 'tax cuts' as a solution to anything. Consequently, they’re not really even prepared to accept the premise that other problems exist. Tax cuts can’t solve climate change, so there must be no such thing! Tax cuts can’t curb inequality, so there must not be a problem with growing inequality."

This is a bit unfair. AEI, for example, is a mixed bag. On the one hand, it was the venue the other day for the Cheney speech, about which the less said the better. But it also still features intelligent and responsible commentary, such as (just to give one example without prejudice to others) this.

The problem is that, when an institution gets too deep in bed with really bad apples (or demanding funders), the good people doing good work there suffer a labeling or guilt by association problem. Or they may need to watch what they say and avoid pursuing some ideas too far. Thus, Holtz-Eakin could accomplish something by creating an institution that stuck to the high road. But the tricky part is getting the funding and prominence needed to pick off the good people from compromised institutions. Making this all the harder, those institutions have good reason to treat a few high-minded people very well. The labeling confusion goes both ways - the institutions gain luster from good and honest work done there, just as the people doing that work risk losing a bit of their own luster.

In discussing his initiative, Holtz-Eakin talks a bit too much for my taste in terms of reviving the Republican Party. It's certainly extremely important for our national welfare - as numerous people on the left have noted - that the Republicans return to planet Earth and to our country's traditions (not to mention those of the Enlightenment). It's also true that hypothetical Republicans who had returned to sanity and decency would be the natural constituency for a policy shop lying on the side of the spectrum that is more pro-market and less focused on inequality. But I would say that the smarter and safer way of getting to that end state would be to utterly ignore the Republicans for now, and wait for them to come calling in 2014 or so. As I would have hoped Holtz-Eakin had already learned, engaging with them now is a recipe for debasing oneself without improving them.

About Me

I am the Wayne Perry Professor of Taxation at New York University Law School. My research mainly emphasizes tax policy, government transfers, budgetary measures, social insurance, and entitlements reform. My most recent books are (1) Decoding the U.S. Corporate Tax (2009) and (2) Taxes, Spending, and the U.S. Government's March Toward Bankruptcy (2006). My other books include Do Deficits Matter? (1997), When Rules Change: An Economic and Political Analysis of Transition Relief and Retroactivity (2000), Making Sense of Social Security Reform (2000), Who Should Pay for Medicare? (2004), Taxes, Spending, and the U.S. Government's March Towards Bankruptcy (2006), Decoding the U.S. Corporate Tax (2009), and Fixing the U.S. International Tax Rules (forthcoming). I am also the author of a novel, Getting It. I am married with two children (boys aged 16 and 19) as well as four (!) cats. For my wife Pat's quilting blog, see Patwig’s Blog.